Parties of the United Nations Framework Convention on Climate Change are committed to protect the climate system for the benefit of present and future generations of mankind, on the basis of equity and in accordance with their common but differentiated responsibilities and respective capabilities. Since the Kyoto Protocol came into force on February 2005, many non-Annex 1 countries have gained momentum into identifying and developing projects, which can reduce the emission of identified greenhouse gases. Implementation of such projects can make them eligible for certified emission reductions, which can be translated into economic gains. Malaysia to date (31 July 2006) has seven registered projects with the CDM Executive Board. All these seven projects use renewable energy resources from the palm oil mills, replacing fossil fuel. This accomplishment would not have been possible if not for the determination of Malaysia to play its role in mitigating climate change. The co-ordinated efforts of the various national supporting agencies, Annex 1 country participation and active Malaysian industrialists are highly commendable. Figure 1 summarizes the various steps in the preparation cycle of a CDM project. A number of criteria set by the international body must be fulfilled for a project to be approved as a Clean Development Mechanism or CDM project. The most important being the additionality criterion, i.e the project must result in the reduction of emissions that would not have occurred in the absence of the project. The emission reduction must be measurable, real and sustainable too. The project must also be developed in compliance with the domestic policies and strategies of the host country and also must uphold its sustainability development policies.